Home office

If you run your business from home, you may be able to deduct part of your home costs. CRA calls this business-use-of-home.

Can you claim it?

You need to meet one of these:

• Your home office is your main place of business.
• You use the space only for your business, and you use it regularly to meet clients or customers.

Work out the share

Use a fair measure, usually floor area: the size of your workspace divided by the size of your home. If the space is also used for personal things, reduce the share for the hours it's used for business.

What you can include

• Heat, electricity and water
• Home insurance
• Maintenance
• Rent, if you rent
• Mortgage interest and property taxes, if you own

You can't deduct mortgage principal. Claiming capital cost allowance on your home is possible but can affect the tax-free sale of your home, so ask an accountant first.

Limits

The home office claim can't create or increase a business loss. Any amount you can't use this year can be carried forward to next year.

In CollabNorth

Keep your home bills in your personal records, not as business expenses. At year end, open your T2125 year on Tax time and fill in the home office helper:

1. Enter the area of your work space and the total area of your home. Tap Use to turn them into a percentage, or type the percentage yourself.
2. Enter the whole year's home costs: rent if you rent; heat, electricity, water, insurance, maintenance, mortgage interest and property taxes if you own.
3. Add any home office amount you couldn't claim last year.

The helper works out the business share and puts it on line 9945. If the claim would create or increase a loss, it stops at your net income and shows the amount to carry forward to next year. See Your T2125 package.

This is general information to help you keep your own records. It is not tax or legal advice.

Based on: CRA: Business-use-of-home expenses and CRA guide T4002

Last checked: 2026-10-13